farm gate

Growth in global dairy production continues to place pressure on global prices and the Australian farm gate milk price.
The average farm gate milk price is expected to drop nine per cent to 47.9¢/litre in 2020-21, according to an Australian Bureau of Agricultural and Resource Economics and Sciences report.
Globally, the COVID-19 pandemic continues to affect demand for dairy products, as Australia’s major dairy export markets restrict imports and implement other measures to control the virus.
ABARES said the growth in global dairy production would also continue to place downward pressure on global prices, which would flow through to the Australian farm gate milk price.
Increased Australian milk production in 2020-21 is forecast to ease some of the competition for milk supply between domestic processors.
The butter price continues to fall from a high of US$6111/tonne in 2017-18, and is forecast to average US$3746/tonne in 2020-21.
Prices of cheese (US$3850/tonne), whole milk powder (US$2867/tonne) and skim milk powder (US$2521/tonne) are expected to remain under pressure and continue to gradually fall.
However, the report said Australia’s cheese exports had not been affected by the volatility in the American market.
Japan is Australia’s single-largest export market for cheese and is expected to continue purchasing about 6000 tonnes/month, accounting for 48 per cent of Australia’s cheese exports.
Subsequent waves of COVID-19 in Japan and related falls in GDP pose potential risks to future cheese demand, but demand for Australian cheese exports remains robust.
A more rapid than expected appreciation in the value of the Australian dollar has also added downward pressure to domestic farm gate prices.
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The average farm gate milk price is expected to drop nine per cent to 47.9¢/litre in 2020-21, according to an Australian Bureau of Agricultural and Resource Economics and Sciences report.